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Congress May Avoid Government Shutdown; Still No Deal On Payroll Tax Cut; GOP Candidates Gang Up On Gingrich; Judge To Sentence Barry Bonds Today; Penn State's Star Witness Testifies; Nuke Material Seized At Moscow Airport; Students Rally Behind FAMU's President;; Mortgage Rates Sink To Record Lows; Stocks Moving Higher; Iraq Veterans Fight For Jobs, Benefits; WikiLeaks Suspect Wants Judge Recused; Shutdown Achieved at Japan Nuke Plant

Aired December 16, 2011 - 10:00   ET

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.

T.J. HOLMES, CNN ANCHOR: We're at the top of the hour here on this Friday morning. I am T.J. Holmes in today for Kyra Phillips.

Kind of a sigh of relief, everybody can kind of let it out today especially in Washington, D.C. Congressional leaders appear to have diffused tonight's deadline to shut down the federal government. This is going to keep the lights on for now it appears. But congress is not finished doing its work.

Kate Bolduan on Capitol Hill; I know there's some work left to do but they're trying to get out of there for the holiday.

KATE BOLDUAN, CNN CORRESPONDENT: Of course, they are. I feel like we should just pause and relish this moment, T.J., to say that good news came from Capitol Hill. That they agreed. They compromised and they agreed to avert this government shutdown.

But, of course, that's short lived because they're still negotiating and have not reached agreement on the other big standoff that we have been covering, how to extend this payroll tax cut for about 160 million Americans.

This tax cut expires at the end of the year and we're told the negotiations between congressional leaders and top aids, they continued late into the evening last night. They will continue today. The hang-ups seem to be honestly the same hang-ups that really have been there all along.

How to pay for this package, if you will, how to cover the cost of the tax cuts and the unemployment and the other tax extenders in the bill, as well as what to do about the Keystone pipeline provision that Republicans have insisted must be part of any final deal.

And House Speaker John Boehner reiterated that insistence just a short time ago. Democrats don't want that in the deal. They say it's unrelated. The president has been opposed to including it in this payroll tax extension deal, but that is all part of the negotiations that are ongoing.

Meantime, T.J., as they're trying to continue these talks to extend the payroll tax cut for a year, Senate Democrats are now floating an idea in considering putting forth a proposal to do a short-term extension, a two-month extension of the payroll tax cut.

Unemployment assistance as well as a two-month extension to prevent cuts to payments to doctors who treat Medicare patients, they say it's a stop gap -- a fallback measure, a backstop if you will to make sure if they can't reach agreement by the deadline that people do not see their paycheck cut as the tax cut would be expiring.

So that's still ongoing. That's not finalized. Talks are continuing though, T.J. and we are following it minute by minute.

HOLMES: We know you are. Kate Bolduan, always a pleasure. Thanks so much. We'll continue to keep an eye on what's happening there.

We're also just three weeks away from the all important Iowa caucuses. No surprise last night that Newt Gingrich who is the frontrunner now, he was the target last night at the presidential debate.

It's the last debate before they start voting in Iowa come the first of January. Our senior political editor, Mark Preston is with us in Washington, D.C. Nobody really dropped the ball, not a major gaffe last night, was it?

MARK PRESTON, CNN SENIOR POLITICAL EDITOR: Yes, no winners and no losers out of last night's debate. T.J., unless you were to say some of the lower candidates who might have had strong performances needed really strong performances.

We are just weeks away from the Iowa caucuses. The fact of the matter is voters are heading to the polls very soon. So if they want a chance at getting into this presidential race, they need to do it now.

We saw this last night from Michele Bachmann trying to force her way back in to the presidential race. She was the one who decided to go after Newt Gingrich and she went after him over his controversial payments he received as a consultant to Freddie Mac. In fact, let's listen to what she had to say.

(BEGIN VIDEO CLIP)

MICHELE BACHMANN (R), PRESIDENTIAL CANDIDATE: I was trying to see these two entities put into bankruptcy because they frankly need to go away when the speaker had his hand out and he was taking $1.6 million to influence senior Republicans to keep the scam going in Washington, D. C. that's absolutely wrong.

NEWT GINGRICH (R), PRESIDENTIAL CANDIDATE: The easiest answer is, that's just not true.

(END VIDEO CLIP) PRESTON: There you have Speaker Gingrich standing in the middle of the state taking incoming from everyone up there except for Mitt Romney. You would expect Mitt Romney who had lost his frontrunner status to Newt Gingrich to try to ding him up a little bit, T.J. he decided not to.

But Mitt Romney did come under some questioning himself regarding social issues. The Fox moderators asked him about how he had changed on such issues as abortion. He said that, look, he has grown over time and, look, that's what happens to people. You change your mind. On the issue of abortion, Mitt Romney said that he made a mistake.

HOLMES: Yes. It was really one of the things that stood out last night, the way that Michele Bachmann really was going at really Ron Paul and going at Newt Gingrich.

Then the other moment that stood out was, I mean, Tim Tebow is everywhere these days. He even found his way on to a Republican debate.

PRESTON: Yes, no doubt, right? So Tim Tebow for us, like you and I who are big sports fans, we know how he is. He was somebody who wasn't supposed to be a superstar in the NFL. He has become a superstar.

And of course, Rick Perry, comes out and decides to compare himself to Tim Tebow. Now Rick Perry was the frontrunner back in August. He was what we would call the flavor of the presidential race at one point.

He has fallen in the polls. However, he said that he will become the Tim Tebow of the Iowa caucuses. So, T.J., we'll have to see what happens.

HOLMES: Yes, I think Tebow is actually polling better than Rick Perry is right now in Iowa. So we'll see what works. Mark Preston, thank you as always. We'll see Mark again.

He'll join us later with an announcement about a huge endorsement for one of the candidates now. We won't give it away right now actually, Mark. So we'll just come back and check it in with you in a little bit, OK?

PRESTON: Terrific.

HOLMES: All right, we're just about 10 minutes from now. We'll check the pulse of what voters are saying in Iowa this morning. We have syndicated radio talk show host, Steve Dase.

He is here to tell us what his listeners are saying about the debate. He's a really good person to check in with right about now. That's coming your way.

Also Barry Bonds, he'll know his punishment today. A judge will sentence him for misleading a grand jury that was looking at a steroid use among pro athletes.

Federal prosecutors want to send the all time home run leader to prison for 15 months. Our Dan Simon is in San Francisco. Dan, by every account I hear, that's not going to happen.

DAN SIMON, CNN CORRESPONDENT: Well, most legal experts think he'll get home confinement, which for Barry Bonds isn't so bad. He lives in a 10-bedroom mansion in Beverly Hills. So that beats the alternative to federal prison.

But, you know, this is a case that goes back all the way to 2003. It's been lingering on for so many years. And of course, Barry Bonds' legacy in baseball will be debated for many years to come in the wake of the steroid era in major league baseball.

But that's an entirely different question that what the judge is faced with today. She has to decide whether or not to send Barry Bonds to prison as we talked about, a home confinement or maybe probation.

You know, this case as I said, started eight years ago. This was a major steroid scandal that originated here in the San Francisco Bay area. Barry Bonds was called to testify in front of a grand jury about that case.

And in that testimony he said he had never used steroids and so prosecutors charged him with perjury as well as obstruction of justice. There was only one charge that stuck. It was that obstruction of justice charge.

So here we are today, Barry Bonds will receive his fate from the Judge Susan Elston in a couple hours from now -- T.J.

HOLMES: All right, Dan Simon there for us. Thank you so much.

It's 7 minutes past the hour. Let's turn back to Penn State now, this child molestation scandal. We're learning more today about what Mike McQueary saw -- says he saw in the showers of Penn State's football program.

Susan Candiotti is at a hearing in Harrisburg, Pennsylvania on the scene there. We have learned a lot this morning. We do need to warn our viewers here, some disturbing details coming out -- Susan.

SUSAN CANDIOTTI, CNN NATIONAL CORRESPONDENT: Good idea to give people a chance if they don't want to hear this to perhaps turn away at this time, but it is disturbing testimony.

But it is the first time we're hearing directly from someone who said that he was an eye witness to an alleged sexual attack, a rape of a boy in the shower room. This is the assistant coach, Mike McQueary, who at the time was a graduate student.

He said he went into the shower room late at night in 2002 and testified that when he looked directly into the shower he saw, he says, Jerry Sandusky and a boy.

McQueary describes that the boy's hands were up against the shower wall shoulder height. McQueary testified that he saw Jerry Sandusky with his hands wrapped around the boy's waist and that he had heard slapping noises going on in the shower as well. McQueary testified that he believed that this was sexual intercourse going on though he couldn't say directly that he saw everything he needed to see to say that.

But he had no doubt in his mind that that's what was happening. He said that he walked toward the shower. The two people turned around, Sandusky and the boy, he says, and that they looked each other directly in the eye.

McQueary then left the locker room, said he was shook up and shocked. First thing, he did was to call his father. Didn't call police, called his father because he said, I respected him. I needed his advice about what to do.

They decided that he should call Coach Joe Paterno first thing in the morning and, in fact, he did early in the morning. Paterno kind of joked and said if you're calling me about a job, this isn't the time.

There was actually laughter in the courtroom during this part of the testimony. But then McQueary told -- testified that he told Paterno he saw something extremely sexual going on in the shower between Sandusky and the boy.

McQueary testified that he didn't use the word sodomy or intercourse with Paterno out of respect for him, but that he saw something extremely sexual going on. Paterno told him he was disturbed about it and that he would take care of it.

At that point, it was nine days later McQueary testified that he eventually got a call from the two Penn State officials who are now charged with failing to report child abuse and perjury before the grand jury.

And McQueary said he told them that something extremely sexual was going on. It was some type of sexual intercourse that happened between allegedly Sandusky and the boy -- T.J.

HOLMES: All right, our Susan Candiotti again new, disturbing details are really going to play a role in this case as it goes forward. Thank you so much. We're 10 minutes past the hour.

Now we're going to turn to another disturbing story, this one having to do with airport security. You know you're not supposed to take pocket knives and guns if you're getting on a plane.

Customs agents in Russia, they got a surprise when they stumbled on to some nuclear material? Zain Verjee with me once again to explain this. How in the world did this happen?

ZAIN VERJEE, CNN ANCHOR AND CORRESPONDENT, CNNI: Well, some passengers stuffed a little radioactive material into their suitcase and thought they would get away with it. It was on a flight going from Moscow to Tehran.

Now according to reports, the passenger was an Iranian and authorities detected radiation 20 times above normal. So they checked out the luggage and low and behold the Federal Customs Service issued this statement with a little more detail here, T.J.

What they're saying is this, 18 metallic objects of industrial origin were found packed into individual steel boxes. They went on to say that tests found it was radioactive isotope sodium-22 and could only have been obtained as the result of the work of a nuclear reactor.

That statement is in direct contradiction with Russia's atomic agency that says sodium-22 is used for medical and scientific research. So what the facts here are we're not completely sure, but these are two conflicting opinions.

There's a criminal investigation going on. CNN's talked to a nuclear expert that said, one, there is not a radiation hazard here and, two, every radiation lab will tend to have sources of sodium-22.

By the way, Russia and Iran have this deal where Iran does get medical isotopes and things of that nature under an agreement that they have. Iran has a medical reactor in Tehran and they run out of fuel.

So they're doing all sorts of things to get what they need whether it's just for medical and scientific research or nuclear or otherwise, it's unclear -- T.J.

HOLMES: All right, out Zain Verjee. Disturbing details, we'll see what happens. Thank you so much.

It's 12 minutes past the hour now. Marching from campus to the governor's mansion. FAMU students say they're not going anywhere for now. They're calling on Governor Rick Scott to change their mind about their school's president. That's next.

Also we're talking politics in Iowa with an Iowa radio talk show host. He does politics for a living. He's listening to the people of Iowa and what they're saying about the Republican candidates. He's joining me. Stay here.

(COMMERCIAL BREAK)

HOLMES: It's quarter past the hour now. In Florida, A&M students are rallying behind their president. Students are upset that Florida Governor Rick Scott is calling for the board of trustees to suspend Dr. James Ammons when it meets Monday over alleged hazing and financial irregularities at FAMU.

Last night, the students took it right to the governor's front door to tell him face to face how they're feeling.

(BEGIN VIDEO CLIP) BREYON LOVE, FAMU STUDENT BODY PRESIDENT: We are not going to leave. Mr. Governor, with all due respect, we will be here all night, all day tomorrow until you apologize and rescind that recommendation. We will not leave.

MARISSA WEST, STUDENT: We support our president a 100 percent. We believe in FAMU and we know that we can get through without the intervention of the governor.

KYLE WASHINGTON, FAMU SUPPORTER: The issue is Robert Champion. We're moving so quickly that we're forgetting that is the issue because now we're focusing on other issues like the fraud and now we have to find another president.

(END VIDEO CLIP)

HOLMES: Investigators are looking into last month's suspected hazing death of drum major Robert Champion. Say they found evidence of financial irregularities. Three other band members are facing charges in a separate alleged hazing incident.

Here a look now at some stories making news cross-country. A man who's been on trial in Minnesota is accused of opening fire in the courthouse. Police say he shot a prosecutor and two others yesterday on the same day he was convicted of sexually assaulting teenage girls. No word yet on how he got his hands on a gun in that courthouse.

Also officials at Lackland Air Force Base in Texas have launched an investigation into this picture, a controversial photo that's now gone viral. What you're seeing here, 15 airmen posing around an open casket.

A casket similar to one used to carry the war dead home. What you see is one of the airmen pretending to be dead inside the casket with a noose around his neck and chains around his body. Trying to figure out why the picture was taken.

Also a miracle. That's how doctors are describing this California baby who was born weighing less than a pound. Baby Melinda now up to 4 pounds, could be home, would you get this, by the New Year. She's the third smallest baby to ever survive.

Let's turn back to politics. We're talking politics we have to be talking about Iowa, the caucuses there just a couple of weeks away. A recent poll by American Research Group shows Newt Gingrich still on top there.

But Mitt Romney and Ron Paul within the sampling or margin of error. Last night's debate, did it really change things? Everybody seemed to be ganging up on Newt Gingrich. He's a frontrunner. That's what happens. He's had to defend himself against being zany.

(BEGIN VIDEO CLIP)

NEWT GINGRICH (R), PRESIDENTIAL CANDIDATE: I sometimes get accused of using language that's too strong so I've been standing here editing. I'm very concerned about not appearing to be zany.

(END VIDEO CLIP)

HOLMES: Well, Steve Deace is the guy to talk to. He's a syndicated radio talk show host in Des Moines talking and listening to Iowa voters all the time. Steve, are they waiting to make up their minds?

STEVE DEACE, SYNDICATED RADIO TALK SHOW HOST: I think there's a lot of people that are still waiting to make up their minds, and I think there's a lot of people that have made up their minds, but they're willing to make them up again.

HOLMES: OK, well, Steve, is it a case if they're waiting because they just love all of their options it's so hard to decide or is it because they don't really like all of their options?

DEACE: I would have said six months ago it was the latter. I actually think this field of candidates has gotten demonstrably better over the last six months.

I hate to say this as a conservative, you guys are partially to thank for it because there's been so many debates. It's like the old phrase iron sharpens iron. The candidates have all gotten better to some extent over the last few months.

HOLMES: I'll deal with that little shot you took at the media there. But tell me here, some of these debates, have the debates, you're right, there have been so many, has that kind of replaced that retail politics?

Are people getting such a view of these candidates on TV over really months now that maybe they don't need to be shaking a lot of hands?

DEACE: I think your observation is very astute. I think there's a lot of long-time Iowa politicos that sort of regret that. And that's what's interesting about Ron Paul.

He is the most unorthodox and quirky candidate in the race. But he's also got the most conventional campaign. He's by far got the best ground game in Iowa. His team has done the best job at retail politics.

HOLMES: Yes, I was talking to you during the commercial break about the things that stood out to you last night. Talk about some of the highlights that people talk about, the moment about Tim Tebow and all of that stuff. But really what stood out to you, clearly Michele Bachmann was on the offensive last night. You think she did damage to two candidates.

DEACE: I thought she did damage to both Newt Gingrich on Fannie and Freddie and Ron Paul on foreign policy according to a lot of the response that I saw in my own analysis. I thought Newt Gingrich was very strong after those initial attacks from Michele.

I thought he was very strong in the second hour, particularly on an issue that Iowans care a lot about, which is the courts and the separation of powers. But Michele, I thought, did damage to those candidates.

The debate for Ron Paul, it reminded me about the debate before the straw poll where Rick Santorum sort of deconstructed Ron Paul on being soft on Iran.

I thought Michele did the same thing and was even tougher on him. I think those answers probably cost Ron Paul a victory in the Iowa straw poll. He only lost by 150 votes or so. I think it may cost him some points come January 3rd.

HOLMES: All right, I have 30 seconds here. Do you actually endorse on your radio program?

DEACE: I have in the past. I've not yet endorsed a candidate. I likely will tell the audience who I'm going to vote for though before January 3rd.

HOLMES: How soon do you think you'll make a choice because you were given a lot of credit for Mike Huckabee's success in Iowa speaking favorably about him on your radio program?

DEACE: Well, I'm having a tough decision like everybody else. I mean, last time I thought we had one great candidate. This time I think we have several really good ones.

HOLMES: All right, Steve Deace, good to talk to you. Hope we can get you back on. Thanks so much. You have a good weekend, all right?

DEACE: You too.

HOLMES: All right, coming your way in about 10 minutes, we're going to be doing our "Political Buzz" panel. See what they thought about the debate last night. Also find out if Rick Perry really is the Tim Tebow of Iowa.

Also coming up, how low can these rates go? You need to hear what mortgage rates are doing right now. Stay with us.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: Why can I not go visit this man?

(END VIDEO CLIP)

HOLMES: Now he's used to beating people up in the movies. This is real life. This is different for Christian Bale. He's the one getting pushed around and punched by Chinese security and a CNN crew was on hand. We'll show this to you.

(COMMERCIAL BREAK)

HOLMES: It's 24 minutes past the hour. Now some good news for you perspective home buyers. Mortgage rates have hit record lows again. Karina Huber at the New York Stock Exchange for us. Just how low can these things go? It seems like every time we say another new low, another new low.

HUBER: I know. That is the big question. Well, we are as low as they can go. Let's take a look what Freddie Mac is saying. The average 30-year fixed rate mortgage is now at 3.94 percent.

That matches the all time low set back in October and rates for the 15-year fixed are even lower at 3.21 percent. Here's the really good news, T.J. The chief economist at Freddie Mac says they'll likely stay near these levels until at least the middle of next year.

So that can translate into big savings for home buyers. Depending on the value of your home that savings can be a few hundred bucks per month if you compare that back to when rates were above 5 percent.

So we're really seeing the perfect and rare combination out there. Cheap home prices and low mortgage rates so if you got some cash in hand and a good credit rating, now really seems to be a good time to buy.

But, of course, prices could continue to fall. As for people who already own homes, this means that they can refinance. We've seen that happening a lot as we've seen these low rates. So even better more incentive right now to go refinance right now, and the reason we're seeing rates so low is because they attract Treasury bond yields.

Treasury bond yields are low right now because there's so much demand for them. They don't need to be hard to attract buyers. They're seen as one of the few safe bets one can make with all of this uncertainty overseas and with the U.S. economy -- T.J.

HOLMES: All right, hour into the trading day. How are the markets looking?

HUBER: Looking pretty good. We're up 87 points on the Dow. Traders seem to be shrugging off a downgrade of U.S. and European banks overnight. They're optimistic heading into the weekend.

Shares of Zynga haven't started trading. We're waiting to see when that happens, but that would be really eyed throughout the day. The game developer behind Farmville and "Words with Friends," something you've seen if you're on Facebook.

They made their public debut today. Zynga Price, it's initial offering at $10 a share. That was in a high into the range and means the company will have raised about a billion dollars in the offering.

It's offering value Zynga just at $9 billion, which is not bad for a company that get it revenue from customers buying virtual good on their games -- T.J.

HOLMES: Yes, that isn't bad. Karina, thank you as always. We'll check in again. We're getting close to the bottom of the hour now.

The Iraq war may be over. The fight though for jobs and health care for Iraq veterans it never scenes it seems. Our Barbara Starr with the story.

(BEGIN VIDEOTAPE)

STARR: After nearly nine years of war in Iraq, it's over. But for the thousands of Iraq veterans who served and have come home, the war may never be done.

I sat down with five Iraq veterans at veterans of foreign war lodge in Virginia. The war, they say, is not over because so many veterans still need help finding jobs, getting health care.

LUIS CARLOS MONTALVAN, FORMER ARMY CAPTAIN: I don't see how anyone in good conscience, be they a general, be they a VA official or politician can say that the war is over.

STARR: Their candour about how many Americans lack of awareness of troop sacrifices can be tough to hear.

CAPT. SHANNON MEEHAN, U.S. ARMY (RETIRED): It's not penetrating their daily lives. Most American public and they can go to airports and clap for veterans or soldiers when they walk by, but there's not much more to that.

KAYLA WILLIAMS, FORMER ARMY SERGEANT: There are ways in which having been to Iraq. I feel separates me from civilians, separates me from those who have never served. That's a barrier I still haven't been able to overcome.

IAN SMITH, FORMER ARMY SERGEANT: I think the attention span in the American public is not broad enough to survive or withdraw of troops. I think it's going to shift. The attention span is going to be focused on the current problems, current crises. Not mopping up the mess of two wars.

STARR: These five veterans all have seen the horror of war. They all suffer from post traumatic stress. They are all enormously proud of their service.

JOHN KAMIN, FORMER ARMY SPECIALIST: I was so proud of the people I served with. At the end of the day, it wasn't about country, it wasn't about it, it wasn't so much about winning any type of war as much as it was about doing what we could do for our particular area of operations and making sure we all got back.

STARR: Barbara Starr, CNN, Virginia.

(END VIDEOTAPE)

HOLMES: You can tune in all day Saturday for CNN NEWSROOM special reporting about the war in Iraq wrapping up. Home from Iraq. Our Barbara Starr sharing the stories of soldiers who served in Iraq, their firsthand impressions of the country they're leaving behind. Again, that is this Saturday.

Coming up next, our "Political Buzz" panel. We have some good characters for you today. They'll be giving you their take on what happened last night. Find out if Rick Perry really is the Tim Tebow of Iowa.

(COMMERCIAL BREAK)

HOLMES: Well just past the bottom of the hour. I'll give you a look at some of the stories making headlines.

The military arraignment underway right now for Bradley Manning, the army private suspected of being behind WikiLeaks, the biggest intelligence leak in U.S. history that went to that Web site.

A CNN correspondent in the courtroom has just learned that Manning's lawyer ask the investigating officer to recuse himself saying the judge is biased.

Also officials at the Tokyo Power Company say a cold shutdown has been achieved at the crippled Daiichi Nuclear power plant in Fukushima.

Also British American author and essayist Christopher Hitchens has died after a long battle with cancer. The long-time contributor to "Vanity Fair" as well as "Newsweek" was 62 years old.

Let's turn back to politics. And time now for your "Political Buzz". That's your rapid fire look at the best political topics of the day. Three questions, 30 seconds on the clock. Who do we got playing today? CNN contributor Maria Cardona; also Sirius XM talk show guy, and just an all around funny dude and great friend, Pete Dominick; and Republican strategist and columnist for "The Hill", Cheri Jacobus. Always good to see all three of you.

MARIA CARDONA, CNN CONTRIBUTOR: It's good to see you.

HOLMES: First question fairly easy one. This one straightforward; GOP candidates had their last debate before the Iowa caucuses last night. Maria, first question to you. Who stood out to you last night in a good way or bad way?

CARDONA: Michele Bachmann stood out to me, T.J. She really took it to several candidates, especially Newt Gingrich on the Fannie and Freddie. And then also slapping him down when he continued to say that she didn't have her facts straight. And I thought that was a bit disrespectful. And I thought she had great come backs to that.

I also think that she took it to Ron Paul on foreign policy. And I think she hurt him a little bit. She hurt Newt Gingrich a little bit.

I think Newt Gingrich came off as arrogant, defensive, professorial; we saw a little bit of the rise in Newt Gingrich. And in a place where you're -- he is seeing his -- his poll numbers slipping, that's not what you want to see in this debate. HOLMES: Cheri? You next, what stood out to you?

CHERI JACOBUS, REPUBLICAN STRATEGIST: Mitt Romney did very well, he did very well addressing the so-called social issues and took the time that he needed to explain himself so that others didn't have to try and explain and slam him for it.

Newt Gingrich did very well I think. He's very good at putting people in their place when they are misspeaking about him. I don't think he is respectful at all.

Michele Bachmann is sort of a mixed bag. On the one hand she looks strong going after her opponents. On the other hand that may have hurt her with some Republicans who really don't like to see that much negativity.

So I think it was a mixed bag for her you know but I think Mitt Romney, Newt Gingrich as expected both did very well and are still the front runners.

HOLMES: Pete?

PETE DOMINICK, SIRIUS XM TALK SHOW HOST: I thought -- I thought Michele Bachmann did a good job standing up to the boys last night; took it to Newt Gingrich and Ron Paul. I thought Ron Paul was amazing with -- with his foreign policy. His point about how he had years -- 30 years with Russian missiles pointed at us. I thought that -- you know, Mitt Romney played it safe. He kept the plastic on the couch, T.J. that $10,000 smile didn't go after anybody.

And if Newt Gingrich gave a seminar on confidence, I would take it. That guy is amazing. Rick Santorum was there and he helped -- he helped Iowa -- Iowa caucus voters know how -- how unequal he thinks gay folks are.

HOLMES: All right, let's move on to Rick Perry and a moment that stood out to us all. Let's listen.

(BEGIN VIDEO CLIP)

RICK PERRY (R), PRESIDENTIAL CANDIDATE: There are a lot of people out there. I understand it. You know there are a lot of folks who said Tim Tebow wasn't going to be a very good NFL quarterback. There are people who stood out and said well, he doesn't have the right throwing mechanisms. Or he doesn't -- you know he's not playing the game right.

And you know he won two national championships. And that looked pretty good. We were the national champions in job creation back in Texas. And so -- but I'm ready for the next level. Let me tell you, I hope I am the Tim Tebow of the Iowa caucuses.

(END VIDEO CLIP)

HOLMES: Cheri, what did you make of it Cheri? Is that a good comparison? Comparing himself to Tim Tebow last night. JACOBUS: Well, my football acumen is very limited. So unless you want to put up a test pattern, and play some elevator music over the rest is history, second I'd like to go to how I thought Rick Perry did. I thought he helped himself last evening. I think that had this been the Rick Perry that showed up at the beginning of these debates, he would have been top tier. Not fabulous, not great but certainly hanging in there, so he -- he comported himself well. I think he helped himself a good bit last night. It might be too late but he did.

HOLMES: All right, we -- put -- we put you in a bad position asking you a football question.

Maria, let me come over to you. I'm not sure how big of a football fan you are? But what did you think of the comparison he made last night?

CARDONA: I thought it was cute. Clearly Tim Tebow is the "it" boy right now. And so I think you know Rick Perry did as well as he could have using humor and using the "it" boy of the moment. But wouldn't he rather be T.J., the Aaron Rodgers of NFL. Aaron Rodgers won the Super Bowl last year, won MVPs, probably will win MVP this time around. The Aaron Rodgers is what the GOP political process is missing; a winner that is recent and somebody who has a very bright future. That's what they're missing.

HOLMES: Oh well Pete, she clearly didn't like the Tim Tebow reference. What did you make of it?

DOMINICK: Well, I don't where -- Maria, I don't know where Aaron Rodgers is on pro-life on the abortion issue. Tim Tebow's famous for doing a pro-life ad with his mom I think a couple of Super Bowl will go. Tim Tebow and Rick Perry have one thing in common. They both crowbar religion into somewhere where it's not supposed to be, politics and sports.

And what was with the -- that first answer Rick Perry gave? He wasn't drowsy anymore. It's all jumpy and caffeinated saying I'm like Tim Tebow. The only thing that would have made that better, that answer better, is if he ended the segment by actually Tebowing -- T.J.

HOLMES: We're going to get a shot of that if people don't know. Go check out Tebowing.com. You'll what we're talking about. Good stuff there, Pete.

We got the "Buzzer Beater" for you now; 20 seconds left. We're talking about Gary Busey. He was backing Newt Gingrich. Now he's backing off that endorsement. Yes, the actor, Gary Busey may be a crushing blow to the Gingrich campaign. At least here is one person's late night opinion of it all.

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CONAN O'BRIEN, LATE NIGHT TALK SHOW HOST: Speaking of the campaign, yesterday Gary Busey withdrew -- this is big political news, by the way. This was worth standing in the rain for. Yesterday Gary Busey withdrew his endorsement of Newt Gingrich. Yes, Mr. Busey has gone back to his prior position of endorsing a jar of raisins.

(END VIDEO CLIP)

HOLMES: Oh we love Gary Busey, don't we? Well the other thing here is South Carolina Governor Nikki Haley is set to endorse Mitt Romney.

So Maria, let me start with you. Who's the better endorsement to have and why? Nikki Haley or Gary Busey?

CARDONA: Well, I think clearly Nikki Haley, but for this question I don't know what's more offensive to Nikki Haley for being compared to -- to Gary Busey or to Newt Gingrich who a has-been actor who suffers from a brain injury is waffling on endorsing him.

HOLMES: Well, yes blame the writer for the question. Cheri what do you think?

JACOBUS: I think the Gingrich camp is jumping up and down that they got Busey (INAUDIBLE). The Nikki Haley endorsement is very, very valuable to Mitt Romney. I think that's something he can feel very good about. They should tout that as much as possible, a real feather in his cap.

HOLMES: Pete what do you make of it?

DOMINICK: I think Gary Busey only endorsed Newt Gingrich because he lost a bet with his toaster, T.J. But listen, this is a great endorsement. This Nikki Haley is a great endorsement. She -- you know, he did not do well in South Carolina last time around. She's got Tea Party support and establishment support. So this is great for Mitt Romney and a great week for Mitt Romney. He got a Christine O'Donnell endorsement and now a Nikki Haley endorsement.

If he gets -- he keeps getting all of these endorsements from strong Republican women, he keeps getting these endorsements and Newt Gingrich might endorse Mitt Romney just to get to know the ladies.

HOLMES: Oh Pete, it was going so well. It was going so well.

DOMINICK: And T.J., before we leave, before we leave I know you're moving on. I know you're moving on T.J. Before we leave I want you to know one thing, my friend. You've been great. You've been so great to me. And I want you to know, I love you.

HOLMES: I love you too, Pete. And I mean that. Thank you so much. We're not done. We're not done. Going to be in touch with all you guys. With Cheri, Pete, Maria --

CARDONA: Absolutely.

HOLMES: Thanks so much, guys.

CARDONA: Happy Friday, thank you.

HOLMES: You all have a good weekend. We're about 40 minutes past the hour now. We need to turn back to a story that continues to develop. Telling you about this army private, the one suspected of being behind the biggest intelligence leak in U.S. history. Our Brian Todd has been keeping up with this case and developments in the courtroom. Brian on the line with me once again -- right in front of the camera this time for me. Brian, give us that update.

BRIAN TODD, CNN CORRESPONDENT: T.J., some pretty dramatic developments in the courtroom this morning. The attorney for Bradley Manning, David Coombs, basically came out with guns blazing and accused the investigating officer who was essentially acting as a judge in this Article 32 hearing accusing that investigating officer of being prejudiced and asking him to recuse himself. That officer is now taking it under advisement hearing from prosecutors so they've taken a break. But a very aggressive move by Bradley Manning's attorney.

He says this investigating officer is prejudiced for four essential reasons. One because he is a career Department of Justice prosecutor and the DOJ is holding its own separate investigation of Bradley Manning and so the defense attorney says that's a conflict.

Second, that he is accused of allowing a disproportionate amount of witnesses to testify for the prosecution but not nearly as many for the defense and he argues that that's prejudicial for that reason. Also, Manning's defense attorney says that the investigating officer's ruling that this could be open to the media is prejudicial, that it would be better to keep it closed and more even-handed, to keep it closed.

And for a fourth reason he says that you've allowed sworn statements from people who essentially have not been sworn in, even statements from people to testify over the phone, and that's prejudicial. So four reasons he laid out right off the bat.

He's laying down a marker, Bradley Manning's attorney is, saying to this investigating officer who's supposed to be presiding over this as an even-handed judge of these proceedings saying you're prejudicial. You should remove yourself from this case.

He did it right off the get-go. And so they're now taking it under advisement. It's a clear marker from Bradley Manning's attorney about how aggressive he is going to be in his defense. He is really going after anyone who can be at least perceived as prejudicial in this case -- T.J.

HOLMES: All right. Brian Todd, thank you so much for the updates throughout the morning.

We're about 42 minutes past the hour.

Joining me next will be our A.J. Hammer. He has your "Showbiz Headlines" for you including Britney Spears about to walk down the aisle.

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HOLMES: Here comes the bride -- Britney. Let me bring in "SHOWBIZ TONIGHT" host A.J. Hammer in New York. Now she's not even engaged yet but -- I mean we're not spilling the beans, are we, man?

A.J. HAMMER, HLN HOST, "SHOWBIZ TONIGHT": No, no. We're breaking the mold though -- T.J. We don't normally report engagements before they happen.

HOLMES: Ok.

HAMMER: But here's the deal. Jason Trawick is reportedly going to pop the question to Spears later tonight in Las Vegas. And yes apparently she does already know about it. And if she didn't, well, it's out there. Britney, I'm sorry if I spoiled it for you.

Trawick is a talent agent. He and Spears have been together for a while. They've been pretty public about their relationship so this is kind of expected. TMZ reporting that Trawick has been seen shopping for an engagement ring. He's asked for permission from Britney's dad.

He's even arranged things with Britney's conservator. She's still under than conservatorship. That's been since 2008 she had some very public drama and a judge has to sign off on any major decisions that she makes, but according to the reports, the conservatorship is still in place because well, quite frankly, it's been working so well for Britney's career and life.

Vegas and Britney and weddings have some history; she married her first husband there. This is almost exactly 12 years ago. T.J., that marriage was annulled after just 55 hours. Of course her second marriage was to Kevin Federline. That ended in divorce so we're all pulling for Britney. Hope she found lasting love with Jason.

But in case things don't work out there's already a report out there that a pre-nup is in place; very modern here in 2011. That's taken care of before the engagement even happens.

HOLMES: Awfully romantic story there for Britney. Hope he works out. Been pulling for her. She went through a lot of stuff in her career and her life so, pulling for her.

And Katy Perry, what's going on for her? Big honor?

HAMMER: Yes, big honor. MTV has named her their artist of year. This is a new honor from MTV. They say that they chose Perry in part because she became the first woman and only living artist to have five singles off the same album hit number 1 on the billboard chart. She's done a lot of other incredible work over the years. She beat out Adele and Nicki Minaj for that honor. Congratulations, Katy.

HOLMES: All right. Good stuff. A.J., thank you as always. And if people, you want more A.J., I know you do, in everything. Breaking in the world of entertainment; he's got it for you this evening. "SHOWBIZ TONIGHT" 11:00 on HLN. (COMMERCIAL BREAK)

HOLMES: Look at some stories that will be making news a little later today.

At noon Eastern, Colton Harris Moore, the teen best known as the "barefoot bandit", he has a plea hearing in his home state of Washington.

Also in the nation's capitol, President Obama speaks to a Jewish conference. That happens a little after 2:00.

And CNN's Wolf Blitzer serves as emcee for the crisis group award dinner that gets underway at 7:30 tonight in D.C.

Also coming up right here, kayakers plunged. Look at that, some 90 feet down a water fall. The thing that got me, they did this on purpose. We'll show you all the video next.

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HOLMES: Give you a look at some of the stories making news cross-country. Look at that. Three dare devil kayakers dropping one by one down a 90-foot waterfall. Yes, they did this on purpose, I'm told. They recorded this whole plunge from every angle, even were wearing helmet cams.

The people that are in charge of this fall -- this is Noccalula Falls in Gadsden, Alabama, they're none too pleased with these kayakers. They say this video made it online, they saw it there. They're now considering banning kayaking in the area.

Also a Tim Tebow tribute got some students suspended. You've heard of this -- Tebowing. This happened at river head high school in New York. Twin brothers started mimicking Tebow's signature -- a lot of people are doing this. There's Web site dedicated to it as well. They're kneeling on one knee in the school hallway, a bunch of other students joined in. The principal was not amused. Suspended the boys for a day. Come on, man.

Also a Stockton, California man got stuck in his chimney overnight. This is 20-year-old man Jorge Herrera. He wedged himself eight feet down. His feet were dangling and touching the floor actually. Firefighters were able to squeeze him out using soapy water.

I know what you're thinking, why was he in the chimney in the first place? Was he robbing the place? Apparently no; it's his home. And they think he was trying to sneak in after curfew. He's 20 years old. He still has a curfew?

It's been a pretty good morning for Mitt Romney; his presidential campaign scoring a major endorsement from South Carolina Governor Nikki Haley. CNN's political director Mark Preston breaking this down for us. Mark, hello to you kind sir. Why is she doing is and why is it a big deal? PRESTON: Well a huge deal, because as you said, she is the governor of South Carolina. That state will vote third in line after Iowa and New Hampshire. South Carolina a very important state because many people think that it is social conservatives, evangelicals that will really play the big role down in South Carolina in helping select the Republican presidential nominee.

Now Mitt Romney, of course, has decided to play in Iowa which is also really dictated by social conservatives. He is playing there now. He expects to win New Hampshire. Then a lot of people think it will come down to South Carolina getting the backing of Nikki who was elected in 2010 is extremely big on two levels. A, she's the governor. She has an operation in the state that, in fact, she can help Mitt Romney try to win that primary in January. And also she is a woman and that could potentially help the governor, former governor of Massachusetts, with women Republicans -- T.J.

HOLMES: All right. And we're going to leave it there. I understand congratulations are in order to our Mark Preston here who has picked up a new title as our political director. Want to say congratulations to you. I remember the days we first started putting you on the air on the weekends. You could barely even put your earpiece in. Now look at you, all grown up.

PRESTON: I was mumbling back then and I still am.

HOLMES: That's all right. You've mumbled your way through it just fine. Really, Mark Preston, it's been a pleasure working with you, no doubt. I know you're going to move on to big things. But still congratulations on playing another prominent role for CNN during the political season.

PRESTON: Thanks, T.J.

HOLMES: All right. Another political update coming your way in one hour. And reminder for the latest political news go to the Web site cnnpolitics.com. That is going 20 wrap it up for me here. Thank you for allowing me to sit in the seat here for Kyra Phillips. But after the break Suzanne Malveaux picks things up for us in the CNN NEWSROOM. Stay here.

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